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As the Comcast Saga Unfolds, Be Careful What You Wish For

Comcast has been in the news recently for deliberately “slowing down” some subscribers and applications in its broadband cable service. There was an article in the Washington Post today updating the case, and there was a recent article in Network World that actually favors the groups filing the complaints and calls for the FCC to crack down on Comcast.

Hang on a second. Those that applaud the groups accusing Comcast have probably not worked through a business plan for broadband Internet access, a service that allows you and I to have somewhere from half to a full T1 of bandwidth right to our home for a measly $30 to $40 per month. When you think about what a dedicated T1 circuit would cost, that is remarkable. Those that find that to be expensive are probably the same ones who get bent out of shape when postage stamps go up a nickel.

In order to find the low price points that the residential market can bear, broadband services operate on thin margins that are tolerable only in light of the volume that a residential market provides. But the model relies on heavy oversubscription.

Oversubscription is not new. It has long been a part of the legacy voice world where erlang tables tell us how many trunks we need to support a user community whose peak call time and average call duration are known. It’s no different now for mobile phones, except that trunks become frequencies and timeslots. Sometimes it breaks down when the statistical assumptions don’t hold or something unusual occurs - think 9/11.

Oversubscription has always been around for consumer Internet access. Back in the dial-up days, an oversubscription model was based on erlang tables that dictated how many modems you needed in your modem pool. The peak call time and average call duration tended to be much different than that of voice networks, but the erlang technique still worked. The natural rate limiting of the slow dial-up modem speed to 28.8, 33.6 or (wow!) 56kbps took the pressure off an ISP’s backbone pipes and transit links. The worry became the number of phone lines and modems. In the early days, the ISPs also metered the time people spent on line, a factor that also played into their oversubscription model.

In the broadband world, oversubscription is based on the burstiness of user traffic and the law of averages that tends to smooth out the traffic load. The average data rate you assume for each subscriber is substantially less than what they actually use when on line, but the burstiness of IP traffic and the human aspects of web surfing dilute the overall traffic volume. You can provision a lot less backbone bandwidth and associated hardware, allowing your price points to be reasonable. Otherwise you would have no marketable product.

File sharing applications like Kazaa, Napster and BitTorrent came along and wreaked havoc with the broadband oversubscription model, creating the need to institute a Fair Access Policy (FAP). This essentially created a market for bandwidth management appliances (BMA) such as Sandvine, Packeteer and the Cisco SCE (formerly P-Cube). Without FAP and BMAs, a few greedy users (typically file sharers) can totally destroy the user experience for everyone.

The issue with Comcast is not about them unfairly eavesdropping or selectively filtering traffic based on some ulterior motive. If they are caught doing something like that, such as not allowing a competing VoIP service, then they should be held accountable. What they are doing is simply executing a FAP so that their user community has fair access to their network capacity and that a few bad apples don’t spoil the bunch. If FAP is not allowed, we may end up with higher monthly fees or even metered service.

Do you really want to see residential Internet access digress back to being metered, where you pay by the MB or by the average Mbps you generate per month? Few people like metered services. Remember in the mid-90s when dial-up Internet access was metered? People were careful not to stay online too long to keep their cost down. This was made obvious when round about 1997 (if memory serves me right) AOL went to flat rate service overnight and, also overnight, saw their network overloaded to the point where it made front page headlines.

People generally prefer flat rates. It’s probably why all-you-can-eat buffets are so popular. I cringe just before opening my mobile phone bill now when my gut is warning me that I went over my minutes and my usually predictable bill has become a car payment. With energy prices where they are, I brace myself before opening the gas and electric bills in the cold winter or hot summer months. How would you like to open your broadband bill and - surprise! - it is $120?

The president of BitTorrent says that Comcast should increase the bandwidth on its network and upgrade its systems to support such applications. Yeah, it’s easy for him to say that since he doesn’t have to foot the bill. And this coming from someone whose application is largely used by teenagers in the process of committing federal crimes like copyright infringement. (Please, let’s not debate this. It is a crime no matter how you feel about the freedom of “information” or how much you hate the music industry. Either way, it’s not the point of this article. But for the record, I don’t download and I don’t want to subsidize the bandwidth costs for those that do.)

If a broadband provider was forced to open its pipes and was not permitted to execute a FAP, their operational expenses would go up in the form of circuit, transit and hardware costs. They would be forced to pass the bulk of these on to their subscribers. They may be able to absorb some of it into their margin as their backbone and transit costs come down. But the rest will show up as a rate increase or some other OPEX cut that ultimately affects subscribers. For example, a reduction in their operations staff that ultimately lowers service quality. Next time you call customer service, don’t complain if you are on hold for a half hour before you are routed to Mars where they’ve outsourced it to save a bit of cash.

To those of you who think FAP is unfair, be reasonable. Broadband prices in the U.S. are cheap in most places. Service providers are not charity groups working for free or at a loss (not intentionally at least.) One day we will all have fiber to our homes with FastE or even GigE bandwidth over them, and this will no longer be an issue. But for now, FAP is necessary to regulate abuse of the shared service so that the bulk of the paying customer base has a good experience. If Fair Access Policy is not allowed, the consequences may be much worse.

Be careful what you wish for.

By Dan Campbell, President, Millennia Systems, Inc.

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